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Crypto Analyst Tom Lee: Bitcoin Dip Triggers ‘Tactically Positive’ Signal for Ethereum, XRP, EOS, Stellar and the Alts

September 06, 2018

The head of research and co-founder of Fundstrat says his firm’s recommendation is to stick with Bitcoin, but notes that the recent crypto flash crash could present an opportunity to trade in altcoins.

In a series of tweets, Lee compares the crypto market’s recent dive to historical trends back in 2014, noting that altcoins saw a 2.7X gain after falling 87%.

CRYPTO: 1/ To put the alt-coin sell-off in a historical context: we created an "alt-coin correction index" which measures what % of alt-coins are down 70% from their 9-month high. Recently, this index hit 97%, the highest reading since 10/25/14. pic.twitter.com/0Oy9lgzHMQ

— Thomas (Tom) Lee (not drummer) FSInsight.com (@fundstrat) September 6, 2018

CRYPTO: 2/ Back in 2014, when this figure hit 87% (all-time high back then, and there were 349 tokens with actual trading volume back then), this was followed within 1 week by a mini alt-coin rally. Alts saw a 2.7X gain (nearly a triple) in 7 weeks. pic.twitter.com/sL812nxwq4

— Thomas (Tom) Lee (not drummer) FSInsight.com (@fundstrat) September 6, 2018

CRYPTO: 3/ While we recommend sticking with #BTC (etc), the alt-coin correction index does seem to suggest this latest downdraft is actually a tactically positive signal for alt-coins.

— Thomas (Tom) Lee (not drummer) FSInsight.com (@fundstrat) September 6, 2018

So far, Lee hasn’t offered his rational for the recent crypto market sell-off.

Current speculation includes market manipulation and a recent report from Business Insider that cites anonymous sources who say Goldman Sachs has shelved plans to create a Bitcoin trading desk in the near future.

Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any losses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.